Our Court of Appeal in V.J.F. v. S.K.W., 2016 BCCA 186 spoke on this issue of excluded property and the presumption of advancement under the Family Law Act.
The parties were married for almost 10 years in a traditional marriage. Throughout the marriage, the Husband worked for P Co. and during the marriage he became a senior executive and part of his boss’ “inner circle”. The Wife was working in sales in the beginning of the marriage and ceased working outside of the home in 2005 to be a “stay-at-home mother”. The parties had three children, two boys age nine and seven at the time of trial, and a daughter, age four.
The family home in Richmond was purchased by the Husband in October, 2003 using his funds for the down payment in his sole name. In 2010, he transferred title to the Richmond Property to the Wife’s sole name.
In 2010, M.I., the Husband’s boss was diagnosed with terminal cancer. The Husband, as a member of the inner circle, was asked to continue with P. Co. to wind up M.I.’s corporate holdings and administer his estate. M.I. decided to give $2 million to each member of his inner circle on his death. The Husband received the $2 million gift from M.I. in August 2011 and used the majority of the funds to purchase property in Vancouver for the parties to build their dream home. The Vancouver property was purchased in the Wife’s sole name. The Husband transferred the Richmond Property to the Wife’s sole name and purchased the Vancouver property in the Wife’s sole name for the same reason: creditor protection (the Husband’s own testimony) and as part of his overall plan to benefit his Wife and family (documentation/evidence and testimony of the Husband, the Wife and a financial planner they saw at the time of transfer). The parties separated in early 2013, prior to the completion of the new house on the Vancouver property (only the foundation work had been completed). The parties would have incurred a loss of $500,000 if they had of sold it as it existed at separation so they agreed to proceed with the construction of the home, drawing from a line of credit by over $1 million that was registered against the Richmond property. The Vancouver property was eventually completed in 2013 and sold for $3.55 million in late 2013. After payment of the Richmond line of credit and other expenses related to the sale, the parties had approximately $2 million in sale proceeds which were held in trust until trial.